<p>In the wake of the ongoing JPEX scandal, the Securities and Futures Commission (SFC) of Hong Kong has pledged to intensify its efforts to combat unregulated cryptocurrency trading platforms operating within the Chinese autonomous territory.</p><h2 id="header-0">Public registry planned</h2><p>As of Monday, the SFC has<a href="https://apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/doc?refNo&#61;23PR106" rel="noopener noreferrer nofollow"> announced</a> a comprehensive plan to address these concerns. One key initiative includes the publication of a publicly accessible list encompassing all licensed, deemed licensed, closing down, and application-pending virtual asset trading platforms (VATPs). The purpose of this list is to empower the public with the information needed to identify potentially unregulated VATPs conducting business in Hong Kong.</p><h2 id="header-1">Ongoing JPEX fallout</h2><p>These new measures arrive in the aftermath of the ongoing JPEX crypto exchange scandal, which local media outlets have characterized as one of the most significant financial fraud cases to ever impact the region. JPEX, a Dubai-headquartered platform, stands accused of offering its services to Hong Kong residents without having applied for a license in the country.</p><p>The SFC pointed directly to the issues at JPEX in its most recent announcement, stating: “The JPEX incident highlights the risks of dealing with unregulated VATPs and the need for proper regulation to maintain market confidence. It also shows that dissemination of information to the investing public through the Alert List, warnings and investor education can be further enhanced to help members of the investing public better understand the potential risks entailed by suspicious websites or VATPs.”</p><p>Christopher “Kit” Wilson, the Director of Enforcement at the SFC, discussed these developments at a<a href="https://cointelegraph.com/news/hong-kong-regulator-sfc-crackdown-unregulated-crypto-platforms-jpex-scandal" rel="noopener noreferrer nofollow"> press briefing</a> held on Monday, alongside addressing the JPEX scandal. Wilson revealed that, due to evasive behavior from stakeholders and unsatisfactory responses to information requests, JPEX was placed on the regulator’s alert list in July 2022.</p><p>It emerged last week that Hong Kong police had taken social media influencer Joseph Lam<a href="https://medium.com/&#64;coinness.gl/crypto-influencer-arrested-in-hong-kong-over-jpex-association-b089cc8026aa" rel="noopener noreferrer nofollow"> into custody</a> related to the scandal. More<a href="https://medium.com/&#64;coinness.gl/jpex-exchange-scandal-sees-crypto-regulation-under-scrutiny-in-hong-kong-e0430924ddbd" rel="noopener noreferrer nofollow"> arrests</a> followed later in the week while authorities indicated that they were looking to tighten up regulation in light of the unfolding JPEX saga. By Friday,<a href="https://medium.com/&#64;coinness.gl/hong-kong-authorities-block-access-to-jpex-amid-ongoing-investigation-20534164abe4" rel="noopener noreferrer nofollow"> access</a> to the web and mobile platforms of JPEX had been blocked with JPEX encouraging users to use VPN to circumvent the measure.</p><p>Wilson further elaborated that a complex investigation, involving multiple parties across various jurisdictions, was initiated by the SFC, which escalated following the receipt of the organization’s first official investor complaint in April 2023. This coincided with the full implementation of the Anti-Money Laundering Ordinance (AMLO) in June 2023, prompting the commencement of a formal fraud investigation.</p><p>Wilson stated: “As a result of that investigation, we issued a formal warning on Sept. 13 and referred the matter to the police.”</p><p>As it stands right now, the financial ramifications of the JPEX scandal are estimated to have reached approximately $178 million. Local law enforcement agencies have received over 2,200 complaints from affected exchange users.</p>

Hong Kong Takes Steps to Enhance Crypto Platform Oversight

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